http://www.bloomberg.com/news/2011-04-2 ... le-1-.html
Drew Price, a 24-year-old mechanic who runs the Los Angeles Saab Club, celebrated the Swedish carmaker’s sale to Spyker Cars NV (SPYKR) last year by getting a tattoo.
He had an airplane with oversized propellers -- Saab’s logo for its classic Sonett and 96 models made in the 1950s and 1960s -- inked on his right arm.
Price’s enthusiasm may have been premature. A little more than a year after General Motors Co. (GM) sold the brand, Saab is again fighting for survival, Bloomberg Businessweek reports in its April 25 issue. Starved of cash, it’s been forced to halt production and is trying to raise funds in a transaction involving the Swedish government, the European Union, GM and Russian billionaire Vladimir Antonov.
“I’d be crushed” if Saab doesn’t make it this time, said Price, who owns seven of its cars.
Saab’s Trollhaettan factory in southwest Sweden has been idle all bar a few days since March 29 after some suppliers halted shipments and demanded payment. Saab owes at least 300 million kronor ($48.9 million) to suppliers, estimates FKG, a trade group representing Swedish auto suppliers.
The man who says he can get Saab back in gear is Antonov, a 35-year-old Russian banker with deep pockets and a love of fast cars. A former Spyker chairman, he was forced to sell his roughly 30 percent share of Spyker as part of the GM agreement.
Tenaci Capital, a company controlled by Spyker Chief Executive Officer Victor Muller, eventually bought Antonov’s stake. The Russian banker wasn’t out of the picture for long.
Supercar Sale
In February, he agreed to pay up to 32 million euros ($46.4 million) for Spyker’s luxury sports car business, which produces the C8 Aileron and other supercar models that sell for more than $200,000. The Dutch company at that time said the deal would provide it with more money to concentrate on reviving Saab.
Before he can put up at least 50 million euros for as much as 30 percent of Saab, Antonov must win approval to invest in the company from GM, the Swedish government, the country’s debt office and the European Investment Bank. All have deals, debt agreements, guarantees or loans outstanding with Saab that give them a say in its future. Thousands of jobs are at stake in Sweden, including those at dozens of parts suppliers.
GM, which remains a supplier to Saab and is slated to build the Swedish company’s upcoming 9-4X crossover at a GM plant in Mexico, declined comment.
Sweden’s Guarantee
For now, Antonov, whose first car was a Saab 9000, is only buying Saab’s properties, including the Trollhaettan factory, and plans to lease them back to the carmaker, jump-starting its cash position.
“I think he’d be good for Saab,” Hakan Danielsson, a 31- year veteran aerodynamics engineer at Saab who sat on its board until last year, said of Antonov. “If we only get over this hump, we should have a great chance.”
Sweden’s debt office today said it is backing Saab’s plan to sell its property. The debt office said it’s prepared to release part of the collateral, including the factory, that’s backing Sweden’s guarantee of Saab’s loan from the EIB, the European Union’s lending arm. The plan would cut the loan to 280 million euros from the 400 million euros agreed previously. Saab so far has drawn 217 million euros.
The EIB has yet to give its approval, the debt office said.
Give Saab a Chance
Sales at Saab, which began building cars in 1947 and gained a reputation for being offbeat, practical, and safe, have been disappointing since its sale to Spyker in February 2010. Last year Saab sold 31,696 cars, down from its original forecast of between 50,000 and 60,000.
Spyker CEO Muller has said sales slipped because it took longer than expected to ramp up production after GM cut Saab’s supplier ties and emptied its factory in January 2010. The Swedish automaker has predicted that by next year it would produce 120,000 cars and be profitable. The hand-over delayed the rollout of Saab’s new flagship 9-5 sedan last year, however, slowing sales and contributing to the cash crunch.
Garel Rhys, president of the automotive industry research center at Cardiff University in Wales, said Saab cannot escape a core problem: its small size.
Standalone Survival
“To be a standalone carmaker these days you really have to have volumes well in excess of one million,” Rhys said. “There was a period about 25, 30 years ago when people mistakenly thought that things like lean production would allow the smaller carmakers to survive easily against the bigger companies. Nothing of the sort has happened.”
Muller said the last couple of weeks, filled with long nights of fierce negotiations, have been “a horrible déjà vu” from early 2010, when he was trying to buy Saab. “You know what the difference is from a year ago?” he asked. “Then, I was battling to save a company that was not mine. If I failed it wouldn’t be my responsibility. Now I’m battling to save a company that is mine, and that is much tougher.”
